FEI Canada Annual Report 2010

Financial Executives International Canada

2010 Annual Report

Canada’s preeminent association

connecting financial executives through networking

knowledge, advocacy and ethical leadership

HIGHLIGHTS 2010 •

Introduced the FEI Canada National Executive Development Webinar Series, producing four webinars with the help of our National Strategic Partners and technical committees.

•

Participated in roundtable meeting on social, environmental and governance reporting with the Ontario Securities Commission in September 2009, with a follow-up meeting in December 2009.

•

Appeared before House of Commons Standing Committee on Finance (FINA) in November 2009 to highlight FEI Canada’s pre-budget consultation recommendations.

•

Participated in a national securities regulator roundtable meeting with the Canadian Securities Transition Office in October 2009; Met with Alberta’s Deputy Minister of Finance in November 2009.

•

Held tremendously successful 2010 FEI Canada Annual Conference in Victoria, BC June 9-11.

•

Hosted FEI Canada’s second annual Small and Medium-sized Enterprise (SME) Conference in Mississauga, as well as the Entrepreneur Conference in Calgary.

•

Partnered with national strategic partners to host five series of national breakfast seminars.

•

Hosted our fifth annual Private Equity Symposium in Toronto, and simulcast live to our chapters in London, Montreal, Winnipeg, Regina, Calgary, Edmonton and Vancouver.

•

Canadian Financial Executives Research Foundation (CFERF) published four new research reports.

•

Hosted two strategic planning meetings, attended by both FEI Canada’s National Board and its Chapter Leadership Council, to further develop and execute the organization’s strategic direction. One meeting took place in Calgary in November, and the other took place in Victoria in June.

table of contents Message from the Chief Executive and the Chair of The Board of Directors

2

Strategic update – year in review

5

Financial performance review

10

FEI Canada condensed consolidated financial statements

14

FEI Canada celebrates its volunteers

19

The Canadian Financial Executives Research Foundation

26

National Strategic Partners

29

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MESSAGE FROM THE CHIEF EXECUTIVE AND THE CHAIR OF THE BOARD OF DIRECTORS If it is true that our future depends on what we do in the present, FEI Canada members can be confident that this organization has a solid foundation on which to stand.

on Finance (FINA), we were pleased to have our efforts recognized by Canada’s Finance Minister, at FEI Canada’s 2010 National Conference in Victoria, BC:

In the past year, our economy has been supported by our country’s strong foundation of financial regulation and reporting standards. Similarly, our country’s sound system of corporate governance has rested on the integrity and reliability of senior financial executives, many of whom are FEI Canada members.

“I am grateful for the advice and support of this organization, particularly during the difficult economic times we’ve all been through.”

Support for and interest in FEI Canada membership helps all financial managers thrive. Our goal last year was to concentrate on membership, both reinstating members lost during the downturn, and making new members aware of the benefits of FEI Canada. And as the storm of the economic downturn subsided, we are pleased that our membership numbers returned to a growth mode as we increased our offerings to members to keep them continually at the top of their game. These new initiatives included our National Executive Development Webinar Series and the ability for members to track online their CPD credits earned through FEI Canada.

We’ve been moving a lot of things forward in the last year, to support our strategic plan.

Our technical committees work continually to address the issues most important to FEI Canada members. We’ve continued our pursuit of advocacy on behalf of our members in the last year, and are well on our way to achieving our strategic goal of being the recognized voice of Canadian financial leaders.

As well as being asked to participate in several roundtable discussions and once again present to the House of Commons Standing Committee

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– The Honourable James M. Flaherty Our Canadian Financial Executives Research Foundation (CFERF) produces research based on what senior financial executives think about topics that are important to you. In the 20092010 year, CFERF published studies on IFRS, private company access to credit, the people issues in M&A deals, and how to best manage during the economic upturn. CFERF has even more in store for the 2010-2011 year, led by our new Vice President of Research and Communications, Christian Bellavance. Many of you will know of Christian from his 14 years as Editor-in-chief at CAmagazine. We are excited to have Christian join the FEI Canada team and hope you are all eager to take part in CFERF studies in the coming year.

FEI Canada is an organization with committed volunteers, and we thank the more than 200 members who contribute to our committees and chapter boards. This volunteer leadership, which represents an amazing 10% of our membership, devotes countless hours of time to our organization and lives by the idea that “you only get out of an organization what you put into it”. A large amount of gratitude goes out

to our wonderful Board of Directors. We would particularly like to thank our retiring directors: Immediate Past Chair Grant Ring; Conference Chair Danley Yip; CFERF Chair Barry Gorman; director Brian McAskill and director Monique Létourneau. It is because of volunteers like these that FEI Canada is the preeminent association for senior financial executives in Canada.

P.S. In the last year we’ve moved our National Office, and are now located at 170 University Ave, Suite 1201 in Toronto. If you’re ever in the area, we love visits from our members! If you give us a call ahead of time, we’d even be happy to find you a place to work if needed while you are in the city.

We would also like to thank the staff of FEI Canada’s National office, who work every day to make FEI Canada’s events better, our advocacy stronger, and our professional development geared to the needs of our members.

And last but not least, on behalf of your 20092010 Board of Directors, chapter leaders and national staff, we would like to thank you! We truly believe that the greater your involvement in the organization, the greater the return will be on your investment, whether it be by participating in your local chapter events or on a committee, or by encouraging your senior financial executive colleagues to join our network.

Michael Conway Chief Executive & National President

Karyn Brooks Chair, 2009-2010 Board of Directors

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TABLE OF CONTENTS When it comes to bringing financial leaders together with their peers, we mean business. While our work is serious, it’s been a pleasure watching friendships flourish and colleagues connect during this memorable and busy year at FEI Canada.

This year marked FEI Canada’s 60th anniversary of connecting our country’s senior financial professionals to share information, best practices and influence regulatory change. In doing so, we have helped maintain the highest professional standards and contributed to thought leadership, supporting Canada’s general economic well being.

As FEI Canada celebrates this milestone, we can take a moment to look back on our recent achievements with pride. These include making significant progress on several aspects of our longterm plan, particularly in the areas of advocacy, awareness building and knowledge exchange.

FEI Canada is increasingly called upon by the government and the media to speak out on various topics of importance to senior financial leaders, and this brings us closer to our stated goal of becoming Canada’s Voice of Finance. FEI Canada has testified twice in a little over a year before the House of Commons Standing Committee on Finance (FINA). We addressed credit availability in March 2009, and taxation in April 2008.

FEI Canada contributed to the Expert Panel on Securities Regulation throughout 2008-2009 and to three expert commissions on pension reform.

FEI Canada drew national media attention at our annual conference in Montréal, which was wellattended and featured several prominent speakers, including the internationally renowned ItalianCanadian businessman, Fiat Group CEO Sergio Marchionne. One of Sergio’s key messages, which

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FEI Canada has long supported, was:

“The real challenge of our time is to create the conditions for virtuous change.

The financial crisis has put values fundamental to any organization to the test: transparency, honesty, reliability.”

Our efforts in influencing the evolution of regulations and standards follow these core values that are fundamental to fair and efficient capital markets. Our advocacy and awareness efforts; knowledge exchange; and networking opportunities have served our members well. As Canadian financial leaders become more aware that we are speaking out on their behalf, we expect more senior financial executives will aspire to join FEI Canada.

As we look to the future, we will keep our sights focused on several key areas, including enhancing membership experience; continuing to grow our public profile and increasing involvement by our volunteers on our technical committees.

Our committees provide individual members an opportunity to help improve public policy, regulatory and accounting standards in Canada.

At the same time, volunteers help expand FEI Canada’s sphere of influence and general profile, while networking with and learning from their peers.

2010

STRATEGIC UPDATE – YEAR IN REVIEW

FEI CANADA MEMBERSHIP In the past year, membership development and retention was made the number one priority across the organization. After being impacted by recession-led membership declines over the June 2008 to January 2010 period, the final five months of the 2009-2010 year saw a significant turn-around in numbers. The national office and chapter boards worked together to spread the word that FEI Canada can benefit all financial executives, especially in hard times.

While FEI Canada worked hard to improve on all organizational key components, including knowledge exchange, communications and advocacy, membership saw a reversal of trends as the number of new members increased while non-renewals decreased. FEI Canada gained 76 new and reinstated members in the month of March, which far exceeds our previous largest monthly increase of 40 new members. Given the tumultuous economic times, we were happy to close the year with more members than we started with, growing to 2015 members.

Our social media campaign continues to grow, as our members join LinkedIn and Twitter. At the end of this year, our FEI Canada LinkedIn group had 576 members and our Twitter feed had about 1,100 followers. These communication tools have allowed us to increase the brand awareness of FEI Canada, and also have been used as recruiting tool and a discussion forum for members.

CHAPTERS

All of our eleven FEI Canada chapters made great efforts to improve and enhance the experience of their members in the 2009-2010 year.

Some exciting events this year: •

•

•

•

•

•

•

•

•

•

•

The Atlantic Provinces Chapter’s dinners with Nova Scotia Finance Minister Graham Steele and Nova Scotia Premier Darrell Dexter.

The Québec Chapter’s gala in honour of long- serving president Serge Pharand, an unforgettable royal evening at the Windsor.

The National Capital Region Chapter’s dinner on the topic “Is Canada’s fiscal sustainability a reality?” with Kevin Page, Canada’s Parliamentary Budget Officer.

The Toronto Chapter’s annual economic update with Dr. Sherry Cooper, Executive Vice President and Chief Economist with BMO Financial Group.

The Southern Golden Horseshoe Chapter’s dinner and tour of the Royal Botanical Gardens with a flamenco guitarist and Spanish Dancers.

The Southwestern Ontario Chapter’s Tour of Western/Roberts Centre for Brain & Mind.

The Winnipeg Chapter’s Christmas luncheon with speaker David Holm of Onyx Financial Group.

The Regina Chapter’s lunch with speaker Pat Youzwa, President/CEO of SaskPower.

The Calgary Chapter’s hosting of the third annual FEI Canada strategy planning session.

The Edmonton Chapter’s dinner on the topic of “Social Networking – New trends and opportunities for your business” with Speaker Mack Male, Founder of Paramagnus Developments.

The Vancouver Chapter’s lunch with Dan Doyle, Executive Vice President – Construction, Vancouver Organizing Committee for the 2010 Olympic and Paralympic Winter Games (VANOC).

We would like to thank all of our dedicated chapter volunteers. Our excellent chapter programming schedule in the 2009-2010 year would not have been possible without your ongoing commitment.

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KNOWLEDGE EXCHANGE EVENTS FEI Canada continues to offer a wide variety of events to members and non-members alike.

Professional development and opportunities to network are noted as the top reasons members attend national and chapter events. In a recent member survey completed in the spring of 2010, members listed National Breakfast Seminars and chapter meetings as the top reasons for becoming and staying a member of FEI Canada.

Our newest offering in the 2009-2010 year was our FEI Canada National Executive Development Webinar Series, which was offered to our members as an added benefit of membership. The four webinars put on in 2009-2010 were on the topics of: •

•

•

•

Private company financing – Renewing a scarce resource; The impending challenge of IFRS financial systems convergence; Failure to plan is a plan to fail – Tips for businesses contemplating a transition; Insights from the 2010 IBM Global CFO study.

Our National Breakfast Seminar Series continued its success across the country, with the topics of: • •

•

•

•

Getting the most from your finance function; Fraud risks in the new economy: Are your bases covered?

Managing the upturn: Key strategies for sustained profitable growth; Anatomy of the acquisition of a troubled business; Credit, capital and financial reporting.

The second annual SME Conference was held in Mississauga on October 22, 2009. This conference was a success and attendees provided positive feedback. The first Entrepreneurial Business Conference was held on October 20, 2009 in Calgary with live video-broadcasts to Vancouver, Edmonton, Regina and Winnipeg.

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The 2010 Private Equity Symposium was held March 23rd at the MaRS Centre in Toronto, with live video broadcasts into London, Montreal, Winnipeg, Regina, Calgary, Edmonton and Vancouver. The program included three compelling panel sessions with industry experts, as well as an excellent closing keynote presentation by David M. Rubenstein, Co-Founder and Managing Director of The Carlyle Group.

The 2010 Annual Conference was held at the Victoria Conference Centre and Fairmont Empress Hotel from June 9-11 in Victoria, BC and was a tremendous success. More than four hundred delegates enjoyed a wide range of educational sessions and networking events.

One of the conference’s highlights was the speech of Canada’s Minister of Finance, The Honourable James Flaherty, who provided his views on the strength of Canada’s financial system through the global crisis and beyond and explained his government’s National Securities Commission initiative. We used the opportunity of his speech to present Minister Flaherty with an FEI Canada honourary membership for his role as “Canada’s CFO”.

In the past year, FEI Canada members earned more than 10,000 CPD credits through FEI Canada’s national events, and many more through chapter events. FEI Canada members can now examine their Continuing Professional Development (CPD) credits earned through FEI Canada events in the members’ only section of the FEI Canada website. Members simply select the dates they would like to review, and then can print out their personal CPD summary.

TECHNICAL COMMITTEES FEI Canada’s two technical committees are the Committee on Corporate Reporting (CCR) and the Issues and Policies Advisory Committee (IPAC).

CCR CCR provides technical advice and recommendations to regulators and standard setters on issues of importance to FEI Canada members. Led by Victor Wells, the committee’s 44 volunteer members submitted 14 letters of recommendation to the AcSB and IASB. Topics included: • •

• • • •

Leases Generally Accepted Accounting Principles for private companies Fair value measurement Rate-regulated activities Improvements to IFRS Accounting standards for not-for profit organizations

IPAC IPAC develops positions on national issues, provides expert consultation to key stakeholders and influences emerging legislation that is relevant to FEI Canada members. Led by William Hewitt, the committee continued to work in a steering committee format. The six IPAC task forces are: • • • • • •

Corporate governance and internal controls Information technology Pensions Private company issues Taxation Treasury and capital markets

Some highlights of the year: • Participated in roundtable meeting on social, environmental and governance reporting with the Ontario Securities Commission in September 2009, with a follow-up meeting in December 2009; • Appeared before House of Commons Standing Committee on Finance (FINA) in November 2009 to highlight FEI Canada’s pre-budget consultation recommendations; • Participated in a National securities regulator roundtable meeting with the Canadian Securities Transition Office in October 2009;

•

Met with Alberta’s Deputy Minister of Finance in November 2009; Made submission to the federal government in response to a call for consultations on specifically proposed pension reform measures.

CFERF

The Canadian Financial Executives Research Foundation (CFERF) continued its mission to study emerging financial management issues in Canada with the aim of increasing competitive capabilities of Canadian financial leaders and their organizations.

In 2009-2010, CFERF published studies on the topics of: • IFRS readiness in Canada: 2009 • People issues in M&A: Learning from experience • Managing the upturn: Key strategies for sustained profitable growth • The role of disclosures in the financial statements of private business in accessing credit In addition to partner-sponsored research, CFERF supports and promotes academic research. This year’s $10,000 academic award was awarded to Professor Amin Mawani of the Schulich School of Business for his research study “The Executive Compensation GAP: Why Does It Exist? And Is It Converging?”

In 2009-2010, CFERF’s Board of Trustees was once again led by Chair Barry Gorman. Barry has dedicated four years to CFERF, and has now passed on the role of Chair to Victor Wells.

Ramona Dzinkowski has been CFERF’s Executive Director for the past three years, a role that will now pass to Christian Bellavance, who has joined FEI Canada as our new Vice President, Research and Communications. Through their work with CFERF, we would like to thank Barry and Ramona for their commitment and dedication to helping make FEI Canada the recognized voice of finance executives in Canada.

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PROFILE AND COMMUNICATIONS

Executive Vice President, Chief Financial Officer & Corporate Development of Enbridge Inc., and Cynthia Devine, Chief Financial Officer of Tim Hortons Inc.

In the 2009-2010 year, the visibility of FEI Canada increased through our ongoing communications efforts and media relations strategy. FEI Canada’s advocacy efforts, CFERF’s research studies and the many charismatic speakers at our events captured the media’s attention.

Canada’s CFO of the Year™ Award is presented to a senior financial leader who has made a contribution to business in Canada with quality, insight and direction.

In April 2010, the National Office sent out a survey to all FEI Canada members to assess member satisfaction. The response rate was good and the respondents’ profile aligned with the demographic breakdown of FEI Canada’s membership. The survey results, which were presented at FEI Canada’s June 8, 2010 Leadership meeting in Victoria, were encouraging. The group of chapter leaders, board members and technical committee chairs reviewed the results and offered ideas as to how the information could be best put to use.

The ideas generated at this session have now been integrated into FEI Canada’s new three-year strategic plan.

BRANDING The Montreal conference in May 2009 was the first time FEI Canada showcased its accomplishments at a trade show. With the success of this initiative, we have since attended other conferences as an exhibitor, to further increase the visibility of FEI Canada.

In an effort to continually strengthen the FEI Canada brand, a standard set of branding guidelines were sent out to all FEI Canada chapters in January 2010. These guidelines include FEI Canada chapter specific logos.

FEI CANADA AWARDS Canada’s CFO of the Year™ Award Congratulations to this year’s two CFO of the Year™ Award winners, Richard Bird, Executive

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In a time where the challenges brought on by Canada’s economic turbulence have tested the mettle of CFOs all across this country, we are very pleased to recognize, for the first time, two outstanding financial professionals who have demonstrated vision, innovation and leadership within their organizations and in their communities.

Frank S. Capon Distinguished Service Award FEI Canada was very pleased to present the Frank S. Capon Award for distinguished volunteer service to Barry Gorman of the Atlantic Provinces Chapter and William Hewitt of the Toronto Chapter. This award honours Mr. Frank Capon, who was an outstanding FEI Canada member for 57 years, and is credited with bringing FEI to Canada in 1948.

Dr. Gorman has been Chair of the Board of Trustees of the Canadian Financial Executives Research Foundation (CFERF) and was a member of the Board of Directors of FEI Canada from 2006-2010. He is currently chair of the Taxation task force of FEI Canada’s Issues and Policies Advisory Committee (IPAC), and has been for many years. Dr. Gorman has been a member of FEI Canada for 18 years.

Mr. Hewitt is FEI Canada’s current IPAC Chair and a member of its Pensions and Capital Markets task forces. He is on FEI Canada’s Best in Class MBA case competition organizing committee, and has been a CFERF trustee since its inception. Mr. Hewitt is also past Chapter President in Toronto and served as founding Chapter President of the Southwestern Ontario Chapter. Mr. Hewitt has been a member of FEI Canada for 40 years.

TABLE OF CONTENTS When it comes to bringing financial leaders together with their peers, we mean business. While our work is serious, it’s been a pleasure watching friendships flourish and colleagues connect during this memorable and busy year at FEI Canada.

This year marked FEI Canada’s 60th anniversary of connecting our country’s senior financial professionals to share information, best practices and influence regulatory change. In doing so, we have helped maintain the highest professional standards and contributed to thought leadership, Right: 2010 CFO of of thegeneral YearTM winners supporting Canada’s economic well being.

Cynthia Devine and Richard Bird with

As FEI Canada celebrates this milestone, we can take a moment to look back on our recent National Managing Partner of CFOY achievements with pride.

These include making Presenting Sponsor PricewaterhouseCoopers significant progress on several aspects of our longterm plan, particularly in the areas of advocacy, awareness building and knowledge exchange.

Michael Conway and Gino Scapillati,

FEI Canada is increasingly called upon by the government and the media to speak out on various topics of importance to senior financial leaders, and this brings us closer to our stated goal of becoming Canada’s Voice of Finance. FEI Canada has testified twice in a little over a year before the House of Commons Standing Committee on Finance (FINA). We addressed credit availability in March 2009, and taxation in April 2008.

FEI Canada contributed to the Expert Panel on Securities Regulation throughout 2008-2009 and to three expert commissions on pension reform.

FEI Canada drew national media attention at our annual conference in Montréal, which was wellattended and featured several prominent speakers, including the internationally renowned ItalianCanadian businessman, Fiat Group CEO Sergio Marchionne. One of Sergio’s key messages, which

FEI Canada has long supported, was:

“The real challenge of our time is to create the conditions for virtuous change.

The financial crisis has put values fundamental to any organization to the test: transparency, honesty, reliability.”

Our efforts in influencing the evolution of regulations and standards follow these core values that are fundamental to fair and efficient capital markets. Our advocacy and awareness efforts; knowledge exchange; and networking opportunities have served our members well. As Canadian financial leaders become more aware that we are speaking out on their behalf, we expect more senior financial executives will aspire to join FEI Canada.

Left: William Hewitt and Barry Gorman

As we look to the future, accept we willthekeep our sights 2010 Capon Award from focused on several key areas, including Michael Conwayenhancing membership experience; continuing to grow our public profile and increasing involvement by our volunteers on our technical committees.

Our committees provide individual members an opportunity to help improve public policy, regulatory and accounting standards in Canada.

At the same time, volunteers help expand FEI Canada’s sphere of influence and general profile, while networking with and learning from their peers.

9

FINANCIAL PERFORMANCE REVIEW The financial results of Financial Executives International Canada (FEI Canada) include the accounts of FEI Canada and the Canadian Financial Executives Research Foundation (CFERF). FEI Canada’s activities are presented below in five categories: membership, events, National Strategic Partner program, CFERF and miscellaneous. Membership revenues include national dues and initiation fees received from our members, whereas membership support costs are shown within various expenditure line items. The events category details results from FEI Canada’s national annual conference held last June in Victoria, our National Breakfast Seminar series and our new National Executive Development Webinar series, our Private Equity

Symposium and our annual SME conference.

The National Strategic Partner Program includes activities with our valued sponsors as well as our prestigious annual event: Canada’s CFO of the Year™ Award. CFERF encompasses research studies and academic awards by and donations to FEI Canada’s research institute. The miscellaneous category represents mainly investment income and fees collected for services rendered in relation to our career centre website. All of these activities are supported by our team at national office, various committees including our two member-staffed technical committees, and funds that are invested in our communications and media relation efforts.

Key Performance Drivers 2010

2009

Revenues

$2,220,051

$2,228,137

Expenses

2,248,836

2,370,948

Excess of expenses over revenues

$ (28,785)

$ (82,811)

2,015

2,010

$350,000

$299,707

Strategic initiatives fund balance

444,837

538,820

Capital asset fund balance

46,260

31,355

$ 841,097

$ 869,882

Number of members Restricted fund balance

Total fund balance

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Financial Position FEI Canada has prudently managed its financial position in an effort to execute its strategic plan.

We have deployed our resources to fund a number of strategic initiatives important to our members:

Membership and Chapter Relations:

FEI Canada continues to put forward initiatives to grow its membership base and to support its volunteers across its eleven chapters. We have highlighted the accomplishments of a number of our valuable volunteers at our annual conference in Victoria. The “Top 10 reasons FEI Canada can help you” document has been developed and a professionally-designed booth has been purchased to support membership recruitment initiatives.

Our National Strategic Partners have helped us grow our membership base by participating in the recruitment of qualified financial executives as new members. Our Financial Executive magazine continues to be appreciated by our members and a digital version is now available.

Knowledge exchange: FEI Canada’s flagship

events such as our Annual Conference, Private Equity Symposium, SME conference, National Breakfast Seminars and Canada’s CFO of the Year™ gala continue to be popular. This year we launched

our National Executive Development Webinar series, and we expect to host more webinars for the benefit of our members in the coming year.

Our two technical committees continue to be very active with regulators, standard setters and various stakeholders. CFERF published four research studies this year, and has conducted the surveys and forums for three more. CFERF also granted an academic award to Prof. Amin Mawani of the Schulich School of Business to undertake research on executive compensation.

Profile and communications: Our team has been very actively working on FEI Canada’s communications, branding and media relations activities. Continued efforts to brand FEI Canada’s name have been supported by the development of a set of standards for use throughout the organization by our chapters and in our communication plans for events and media relations. We have strengthened the use of social media (LinkedIn and Twitter) and ensured its use supported all aspects of our strategic plan.

We continue to publish our monthly Xpress and Finance and Accounting Review e-newsletters to keep members up-to-date on valuable information on their membership and current issues in accounting and finance.

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Results of Operations FEI Canada reported an excess of expenses over revenues of $28,785 for the year ended June 30, 2010, compared to an excess of expenses over revenues of $82,811 a year ago.

Revenues Revenues were down $68,000 or 3% from a year ago, to $2,220,000. Membership dues and fees, representing 38% of our revenues, were down $89,000 or 9.5% over last year due to the impact of the membership decline during the recession

last year and to certain recruitment promotions this year. Events, which account for 35% of our revenues, were similar to last year as income from the different mix of breakfast seminars and webinars mainly offset slightly lower revenues from our annual conference. Our association with strategic partners yielded 18% of our revenues, up $29,000 or 8% as we welcomed two new sponsors.

CFERF’s expanded research capabilities increased its revenue by $35,000 or 32%, as more research studies were produced this year. Miscellaneous revenue declined $34,000 or 38% compared to last year due to lower investment and career services income offset by a non-recurrent sales tax refund.

Revenues

Membership dues and initiation fees

Events

35%

38%

Miscellaneous

National Strategic Partner program

3% CFERF research studies and donations

6%

12

18%

Expenses

base was spent on CFERF’s research costs and award program, up $54,000 or 30% from last year, as research capabilities were strengthened.

Our spending on profile, branding and advocacy accounts for 2% of our costs, down $94,000 or 67%, stemming from the non-recurrence of costs for our 60th anniversary celebration last year and the strengthening of our in-house communications capabilities.

Expenses of $2,249,000 decreased $122,000 or 5% from a year ago. Compensation expenses, which represent 41% of FEI Canada’s expenditures, decreased $92,000 or 9% over last year, mainly related to the change in our net pension plan obligation. Event costs represented 23% of our total expenses, down $18,000 or 3% from last year, mainly resulting from cost savings from our annual conference. Administration, occupancy and other costs, which account for 20% of our expenditures, increased $22,000 or 5%, mainly due to higher costs to support our membership initiatives. Eleven percent of our cost

Expenses

National Strategic Partner program

3%

Profile, branding & advocacy

2%

CFERF costs and awards granted

11%

Administration, occupancy and other costs

Compensation

41%

20%

Events

23%

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FEI CANADA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS MANAGEMENT’S RESPONSIBILITY FOR FINANCIAL REPORTING Management is responsible for the preparation of the consolidated financial statements and the condensed consolidated financial statements of Financial Executives International Canada/Dirigeants Financiers Internationaux du Canada (FEI Canada) and for their integrity and objectivity. These financial statements have been prepared in accordance with Canadian generally accepted accounting principles appropriate in the circumstances and have been approved by the Board of Directors.

We maintain the necessary system of internal controls to ensure the transactions are authorized, assets are safeguarded and proper records are maintained.

Our Board of Directors, upon recommendation from our Audit and Finance Committee, reviews and monitors the quality and integrity of our financial statements, ensures effectiveness of systems and disclosure and internal controls over financial reporting, and reviews and provides oversight in the management of risks.

Hillborn Ellis Grant LLP, our independent external auditors, have been appointed by our Board of Directors on the recommendation of the Audit and Finance Committee. Their appointment was ratified at the annual meeting of members. The auditors have full and unrestricted access to the Audit and Finance Committee to discuss their audit and related findings. They have performed an independent audit of our consolidated financial statements and expressed an opinion without reservation. They have also prepared a report on our condensed financial statements which is presented on page 15.

Toronto, Ontario September 9, 2010

Michael Conway, CA, ICD.D

Chief Executive & National President

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Line Trudeau, CA, MBA Chief Financial Officer

AUDITORS’ REPORT ON CONDENSED CONSOLIDATED FINANCIAL STATEMENTS To the Members of Financial Executives International Canada/ Dirigeants Financiers Internationaux du Canada The accompanying condensed consolidated statement of financial position and the condensed consolidated statement of revenues and expenses are derived from the complete financial statements of the Financial Executives International Canada/Dirigeants Financiers Internationaux du Canada as at June 30, 2010 and for the year then ended on which we expressed an opinion without reservation in our report dated September 9, 2010. The fair summarization of the complete consolidated financial statements is the responsibility of the organization’s management. Our responsibility, in accordance with the applicable Assurance Guideline of The Canadian Institute of Chartered Accountants, is to report on the condensed consolidated financial statements.

In our opinion, the accompanying condensed consolidated financial statements fairly condense, in all material respects, the related complete financial statements in accordance with the criteria described in the Guideline referred to above.

These condensed consolidated financial statements do not contain all the disclosures required by Canadian generally accepted accounting principles. Readers are cautioned that these statements may not be appropriate for their purposes. For more information on the organization’s financial position and results of operations, reference should be made to the related complete financial statements.

Toronto, Ontario September 9, 2010

Chartered Accountants Licensed Public Accountants

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Condensed Consolidated Statement of Financial Position As at June 30

2010 $

2009 $

Current Assets

2,353,776

2,025,795

Capital Assets

46,260

31,355

2,400,036

2,057,150

1,309,469

944,871

249,470

242,397

1,558,939

1,187,268

Restricted

350,000

299,707

Strategic Initiatives

444,837

538,820

46,260

31,355

841,097

869,882

2,400,036

2,057,150

ASSETS

LIABILITIES Current Liabilities Long-Term Liability Accrued Pension Liability

FUND BALANCES Operating

Invested in Capital Assets

Karyn Brooks, FCA

Chair, Board of Directors 2009-2010

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Ray Hawrelak, CA Chair, Audit & Finance Committee 2009-2010

Condensed Consolidated Statement of Revenues and Expenses Year ended June 30

2010 $

2009 $

Membership dues and initiation fees

836,144

924,759

Events

787,841

797,204

National Strategic Partner program

396,125

367,125

CFERF research studies and donations

143,641

108,800

Miscellaneous

56,300

90,249

2,220,051

2,288,137

Compensation

923,215

1,015,413

Events

522,689

540,482

Administration, occupancy and other costs

445,229

423,438

CFERF costs and awards granted

238,306

183,772

74,171

68,568

45,226

139,275

2,248,836

2,370,948

(28,785)

(82,811)

Revenues

Expenses

National Strategic Partner program Profile, branding and advocacy Excess of expenses over revenues for year

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NOTE TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS June 30, 2010

Description of Organization and Basis of Presentation Financial Executives International Canada/Dirigeants Financiers Internationaux du Canada (FEI Canada) is a not-for-profit membership organization established to serve as an effective advocate for the business community with respect to financial and accounting matters, and the reporting thereon, and to improve the communication of financial information to all interested parties. It is a registered nonprofit organization, which is exempt from income taxes under the Income Tax Act (Canada).

The condensed consolidated financial statements include the accounts of the organization’s controlled foundation, Canadian Financial Executives Research Foundation/Fondation De Recherche Des Dirigeants Financiers Du Canada (CFERF). CFERF is separately incorporated and was formed to promote, conduct and sponsor research and publishing projects on business management topics. FEI Canada provides administrative support and management to CFERF and is not remunerated for this support.

FEI Canada is affiliated with chapters throughout Canada, and with Financial Executives International in the United States (FEI). FEI Canada chapters are independently responsible for funding and managing their operations and, accordingly, are not consolidated in these financial statements.

Full financial statements may be viewed on the FEI Canada website at www.feicanada.org/fullfinancialstatements/2010-2011.

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FEI Canada Celebrates Its Volunteers

Clockwise: 2009-2010 Strategic retreat; Toronto Chapter President Kay Brekken and Steve Rosen; William Hewitt with the “Queen� of Victoria Conference entertainers; Victoria Conference chair Danley Yip; Entrepreneur Day in Calgary, October 2009.

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Right: Volunteers having a laugh at the Victoria conference

TABLE OF CONTENTS When it comes to bringing financial leaders together with their peers, we mean business. While our work is serious, it’s been a pleasure watching friendships flourish and colleagues connect during this memorable and busy year at FEI Canada.

Left: Bob Rollwagen, This year marked FEI Canada’s 60th anniversary Stephen Ilkiw and Azam of connecting our country’s senior financial professionals to share information, best practices Foda at the CFO of the and influence regulatory change.

In doing so, we YearTM Gala have helped maintain the highest professional standards and contributed to thought leadership, supporting Canada’s general economic well being.

Right: Michael Conway

As FEI Canada celebrates this milestone, we and FEI Canada Board can take a moment to look back on our recent of Directors Chair, Karyn achievements with pride. These include making Brooks significant progress on several aspects of our longterm plan, particularly in the areas of advocacy, awareness building and knowledge exchange.

FEI Canada is increasingly called upon by the government and the media to speak out on various topics of importance to senior financial leaders, and this brings us closer to our stated goal of becoming Canada’s Voice of Finance. FEI Canada Below: Southwestern has testified twice in a little over a year before Ontario Chapter President the House of Commons Standing Committee on Sue Deakin and Vice Finance (FINA). We addressed credit availability President Nicole Archibald in March 2009, and taxation in April 2008.

FEI Canada contributed to the Expert Panel on with Winnipeg Chapter President Bev Davies Securities Regulation throughout 2008-2009 and to three expert commissions on pension reform.

FEI Canada drew national media attention at our annual conference in Montréal, which was wellattended and featured several prominent speakers, including the internationally renowned ItalianCanadian businessman, Fiat Group CEO Sergio Marchionne. One of Sergio’s key messages, which Right: Chapter Leadership Award recipients, Howard Johnson, Danley Yip, Leslie Markow, Brian McAskill, Judy Munro, and Cliff Truax.

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FEI Canada has long supported, was:

“The real challenge of our time is to create the conditions for virtuous change.

The financial crisis has put values fundamental to any organization to the test: transparency, honesty, reliability.”

Our efforts in influencing the evolution of regulations and standards follow these core values that are fundamental to fair and efficient capital markets. Our advocacy and awareness efforts; knowledge exchange; and networking opportunities have served our members well. As Canadian financial leaders become more aware that we are speaking out on their behalf, we expect more senior financial executives will aspire to join FEI Canada.

As we look to the future, we will keep our sights Left: Leah Halpenny, Jordan focused on several key areas, including enhancing Beallor and Robert Snyder membership experience; continuing to grow our public profile and increasing Tee off involvement in Victoria with the by our volunteers on our technical committees. help of Kay Brekken Our committees provide individual members an opportunity to help improve public policy, regulatory and accounting standards in Canada.

At the same time, volunteers help expand FEI Canada’s sphere of influence and general profile, while networking with and learning from their peers.

2009-2010 Board of Directors Chair

Karyn Brooks

Vice Chair

Louis Marcotte

Québec (A) (G)

Immediate Past Chair

Grant Ring

Regina (G)

Chair, Chapter Leadership Council

Lisa Dorian

Vancouver

Chair, Audit & Finance Committee

Ray Hawrelak

Edmonton (A)

Chair, Committee on Corporate Reporting

Victor Wells

Southern Golden Horseshoe

Chair, Issues & Policies Advisory Committee

William Hewitt

Toronto

Chair, 2010 Conference Committee

Danley Yip

Vancouver

Chair, CFERF

Barry Gorman

Atlantic

Directors-at-Large

Jim Fergusson

Calgary (A)

Susan Nemec

Winnipeg (A)

Bill Ross

Toronto

Brian McAskill

Toronto (A)

Monique Létourneau

Québec

James Saretsky

Calgary

Chief Executive & National President

Michael Conway

Toronto (G)

Secretary & CFO

Line Trudeau

Southern Golden Horseshoe (G)

Chair of the Board, Financial Executives International

Jerry Urich

Central Pensylvannia

Vice Chair of the Board, Financial Executives International

Brian Ruttencutter

Orange County

President & CEO Financial Executives International

Marie Hollein

Chicago

Québec (G)

(A = Audit & Finance Committee) (G = Governance Committee)

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FEI Canada National Staff Chief Executive & National President Chief Financial Officer Vice President, Research & Communications Senior Writer, CFERF Research & Communications Coordinator Membership Coordinator Membership Associate Director of Events Marketing & Events Coordinator Director of Sponsorship Office Administrator

Michael Conway Line Trudeau Christian Bellavance Laura Bobak Melissa Gibson Sydney Freeston Karen Danis Cameal Prince Marita Dias Don Comish Pat Todd

Chapter Leadership Council

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Chair

Lisa Dorian, Vancouver

National

Karyn Brooks, Québec Louis Marcotte, Québec Michael Conway, FEI Canada Line Trudeau, FEI Canada Sydney Freeston, FEI Canada

International

Chapter representatives

Diane Albergo, FEI U.S. Joe DiLorenzo, Boston Brian Ruttencutter, Orange County Nichole Archibald, Southwestern Ontario Brad Bardua, Vancouver Patrick Bieleny, Edmonton Kay Brekken, Toronto Fred Burke, Toronto George Chiarucci, Toronto Dan Clarke, Atlantic Provinces

Brad Cruickshank, Vancouver Beverley Davies, Winnipeg Sue Deakin, Southwestern Ontario Azam Foda, Southern Golden Horseshoe Carl Gauvreau, Québec Chapter Nola Heale, Calgary Dwayne Henley, Winnipeg Betty Hoffart, Regina Michel Houle, National Capital Region Ken Kember, National Capital Region Bertrand Lauzon, Québec Chapter Laurie Powers, Regina Robert Rollwagen, Southern Golden Horseshoe Michael Shabada, Edmonton Maureen Sullivan, Atlantic Provinces Drew Thomson, Membership Chair, Calgary

Issues and Policies Advisory Committee (IPAC) IPAC Steering Committee IPAC Chair

William Hewitt, Toronto

Chief Executive & National President

Michael Conway, Toronto

Chair — Taxation

Barry Gorman, Atlantic Provinces

Chair — Corporate Governance & Internal Controls

Lisa Dorian, Vancouver

Chair — Capital Markets

Bill Ross, Toronto

Chair — Pensions

Peter Donovan, Toronto

Chair — Private Company Issues

James Saretsky, Calgary

Chair — Information Technology

Timothy Spielman, Calgary

2009-2010 IPAC contributors and task force members: Bob Angel, Toronto

Lawrence Kryzanowski, Québec

Bruce Bailey, Toronto

Nancy Lala, Toronto

Peter Ballachey, Vancouver

Shari Laubenstein, Calgary

Anne Burpee, Toronto

Hugh Lindsay, Vancouver

Nigel Byars, Toronto

William MacKenzie, Calgary

Greg Blunden, Atlantic Provinces

Marc Malouin, Québec

Michael Boychuk, Québec

Timothy McGillicuddy, Edmonton

Wayne Braun, Calgary

Florian Meyer, Toronto

William Bushett, Grant Thornton

Tom Pahapill, Southern Golden Horseshoe

Rod Butcher, Ryan ULC

Stan Pasternak, Toronto

Larry Cooper, Toronto

Serge Pharand, Québec

Bev Davies, Winnipeg

Darren Schrader, Vancouver

Marc Diamant, Toronto

Grant Smith, National Capital Region

Peter Effer, Toronto

Brad Sutherland, Toronto

James Fergusson, Calgary

Darla Sycamore, Toronto

Norm Ferguson, Edmonton

Dana Thiessen, Winnipeg

John Forester, Toronto

Gerry Wahl, Vancouver

Dennis Fortnum, KPMG

John Weerdenburg, National Capital Region

Sonjia Johansen, Regina

David Wood, Atlantic Provinces

Natalia Kochetova-Kozloski, Atlantic Provinces

Timothy Wright, Toronto

Naresh Koshla, Toronto

Tim Zahavich, Southern Golden Horseshoe

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Committee on Corporate Reporting (CCR) Chair

Victor Wells, Southern Golden Horseshoe

Vice Chair

Tyrone Cotie, Atlantic Provinces

Vice Chair

Sean Carleton, Calgary

Nicole Archibald, Southwestern Ontario

Carol Lyons, Toronto

Joanne Boyes, Regina

Ian MacNair, Toronto

Karyn Brooks, Québec

Philip Maguire, Toronto

Anne Burpee, Toronto

Marc Malouin, Québec

Susan Campbell, Toronto

Glenn Menuz, Calgary

Fabiana Chubbs, Vancouver

Lucio Milanovich, Toronto

Michael Conway, Toronto

John Mockler, Southwestern Ontario

William Cromb, Calgary

Neil Roberston, Calgary

Frank D’Andrea

Pamela Steer, Toronto

Tim Deacon, Toronto

Debbie Stein, Calgary

Robert Eisner, Regina

Kathy Stevenson, Vancouver

Brian Fielder, Toronto

Darla Sycamore, Toronto

Carolyn Graham, Edmonton

Winson Tang, Calgary

Gordon Heard, Southern Golden Horseshoe

Line Trudeau, Southern Golden Horseshoe

Edward Jonasson, Toronto

Mark Walsh, Toronto

Sujeet Kini, Southern Golden Horseshoe

John Weerdenburg, National Capital Region

Nancy Lala, Toronto

Cheryl Yaremko, Vancouver

Melanie Litoski, Calgary

Tim Zahavich, Southern Golden Horseshoe

Victoria 2010 Conference Committee Chair Danley Yip, Vancouver Brad Bardua, Vancouver Roger Bissoondatt, Vancouver

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Issa Nakhleh, Vancouver

Fabiana Chubbs, Vancouver

Louis O’Brien, National Capital Region (Ottawa 2011 Conference Chair)

Frank Hunaus, Vancouver

Greg Pedersen, Vancouver

Sharon Hunt, Vancouver

Jeff Shickele, Vancouver

Neil Hummel, Vancouver

Max von Trebra, Vancouver

Douglas King, Vancouver

Cliff Truax, Toronto

Dan Ko, Vancouver

Alan Wong, Vancouver

Frederick Metcalfe, Vancouver

Cheryl Yaremko, Vancouver

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The Canadian Financial Executives Research Foundation (CFERF) Studying emerging financial management issues in Canada, with the aim of increasing competitive capabilities of Canadian financial leaders and their organizations.

Board of Trustees Chair Vice Chair, Research Executive Director Chief Executive & National President Secretary & CFO of FEI Canada Chair, Audit & Finance

Directors-at-Large Tom Evans, Southern Golden Horseshoe (A) William Hewitt, Toronto (A) Lawrence Kryzanowski, QuĂŠbec (R) Nancy Lala , Toronto (R) Per Mokkelbost, Toronto (R) Massood Oroomchi, Toronto (A) Geoffrey Poitras, Vancouver (R) Darla Sycamore, Toronto (R) (A) Victor Wells, Southern Golden Horseshoe (A) (A = Audit & Finance Committee) (R = Research Studies Committee)

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Barry Gorman, Atlantic Provinces Alfred Black, Winnipeg (R) (A) Ramona Dzinkowski (R) (A) Michael Conway, Toronto (A) Line Trudeau, Southern Golden Horseshoe (A) Mark Walsh, Toronto (A)

We greatly acknowledge the contributions of our donors: Bryan Albo

Dale Lawr

Darryl Bergman

Greg Lohnes

Richard Birmingham

Rick Low

Jay Biskupski

Michael Makinson

Karyn Brooks*

Mary Martin

Joseph Brown

Brian McAskill

Kent Carson

Carl McMurray

Denis Chabot

Glenn Menuz

Laurent Charron

Douglas Proll

Michael Conway

Michael Ptasznik

Tyrone Cotie

Edward Reid

Gordon Currie

Greg Reiser

Dwayne Dahl

Grant Ring

Robert Dietrich

Robert Rollwagen

Michael Doolan

Bill Ross

Thomas Evans

Ravi Rupnarain

Norm Ferguson

Siva Sivarajah

James Fergusson

John Steen

Philip Filippopoulos

Kathy Stevenson

David Garofalo

Dennis Terry

Pierre Gaussiran

Joy Thomas

Barry Gorman

Line Trudeau

William Gullage

Douglas Urch

Carl Hartigan

Gerry Wagner

Ray Hawrelak

Mark Walsh

William Hewitt

Ian Walton

Rick Hoffman

Bruce West

Albert Jones

Corey Zahn

William Keen Hanif Ladha

* Karyn Brooks generously donated her outgoing Chair gift to CFERF

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National Strategic Partners

Thank you to our 2009-2010 national Strategic partners for their ongoing support

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FEI CANADA CHAPTERS Atlantic Provinces QuĂŠbec National Capital Region Toronto Southern Golden Horseshoe Southwestern Ontario Winnipeg Regina Edmonton Calgary Vancouver

Canada’s preeminent association

connecting financial executives through networking

knowledge, advocacy and ethical leadership

170 University Ave., Suite 1201 Toronto, Ontario M5H 3B3 416.366.3007 1.866.677.3007 www.feicanada.org